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Health Funds says research data wrong

The Health Funds Association says Roy Morgan's reseach on health insurance is wrong and the numbers don't stack up with what the association sees.

Wednesday, April 9th 2014, 9:38PM 1 Comment

The Health Funds Association says recent research from Roy Morgan has "false findings" on health insurance coverage.

HFANZ chief executive Roger Styles said the research had a number of factual errors which went way beyond the margin for error claimed.

“The biggest error was overstating the drop-off in coverage over recent years, with the survey asserting just 25% of New Zealanders are covered by health insurance, when it is actually 30%.

“But there are other serious flaws in the research assertions relating to premiums, market shares and in the speculation over the cause of the decline in coverage,” Styles said.

Premium increases were driven by increased claims costs, which in turn arose from medical inflation and higher utilisation rates, rather than as a result of spiralling adverse selection effects as Roy Morgan suggested, he said.

In March 2005, the number of New Zealanders with health insurance cover was 1,342,000, not 782,000 as Roy Morgan said. As at December 2013, the number stood at 1,336,000, not 516,000 as Roy Morgan claimed.

“In other words, the total number of lives covered is little different than in 2005.  The numbers covered increased a little until the end of 2008, then declined with the drop-off in economic activity post 2008,”  Styles said.

“Increased population means there has still been a small drop in the proportion of New Zealanders with health insurance.  This has been from 32.5% to 29.7%.”

Other errors in the Roy Morgan data include:

  • Market share information is incorrect.  81% rather than 66% of New Zealanders are insured by one of the top three providers.
  • Southern Cross Health Society has a market share of 61% not 48.4%
  • Tower no longer provides health insurance in NZ, having sold its health insurance book to nib over a year ago.
  • The level of health insurance coverage in Australia is actually around 50%, while the research gives the figure of 40%.
  • Roy Morgan states that private health insurance coverage has dramatically declined among 25-34-year-olds with one in five covered in 2014 compared with one in three in 2005. HFANZ information shows the number of 25-34-year-olds with health insurance went from 150,000 in 2005 to 149,000 in 2014.
  • Roy Morgan says the proportion of 50-64-year-olds with private health insurance cover has declined from just under half in 2005 to 37 percent in 2014. HFANZ information shows the 50-64-year-old age group has increased by 6000 since 2005.


« Roy Morgan paints sobering picture of insurance coverageAccuro switches ratings agencies »

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Comments from our readers

On 8 May 2014 at 4:13 pm Ray said:
Just what we've come to expect from Roy Morgan. Completed spurious and unreliable information.

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